Wife played role in scam, suit claims

Oct. 1, 2013

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Investors who say they were bilked by East Walnut Hills money manager Glen Galemmo describe his wife as an integral part in the scheme that allegedly cost them hundreds of millions of dollars, according to an amended complaint filed Tuesday in Hamilton County Common Pleas Court.

Kristine Galemmo, who formerly taught at St. Mary School in Hyde Park, had earned the nickname “Kris the Closer” for her role in her husband’s investments, according to the new court filing.

The filing also indicates that some of Galemmo’s investors are turning against each other. Two civil cases seeking money have been filed so far, one on behalfof more than 150 investors, and another for Michael Willner, a California man whose suit is “on behalf of himself and all other similarly situated.

The filing also indicates that some of Galemmo’s investors are turning against each other. Two civil cases seeking money have been filed so far, one on behalf of more than 150 investors, and another on behalf of Michael Willner, a California man whose suit is “on behalf of himself and all other similarly situated.” The former suit has added Willner as a defendant alongside Glen Galemmo, Kristine Galemmo and a slew of Galemmo’s investment funds.

The amended complaint alleges that Willner helped solicit investors for Galemmo and wrote a letter to numerous investors in July apologizing for his actions.

In the email, filed as part of the complaint, Willner asked the investors for “forgiveness” for serving as a referral for Galemmo’s Queen City Hedge Fund and said he’s hopeful that investors’ money will be returned.

He said he had agreed to be a referral for Galemmo because he’d been in the fund since 2005 and felt like he owed Galemmo as it’d been “a very profitable ride.” The formerly retired Willner also said that as of July 19, he’d begun selling his assets and looking for work because “all of my money was with Glen.”

“Like most of us I ignored the poor statements and lack of transparency in favor of the high returns,” he allegedly said in the email. He added that in hindsight, those were “warning signs.”

Meanwhile, new filings Tuesday in Willner’s case aim to undermine the suit in which he’s now a defendant. He claims that suit is invalid because it represents more than 150 people, and federal law preempts any class-action lawsuit of greater than 50 class members.

Willner also alleges that allowing the class suit to proceed “would further complicate an already complicated case.” That’s because some investors did pocket money from their investments with Galemmo, and those “net winners” will ultimately be pitted against investors who lost money in court.

Galemmo has declined comment through his lawyer, Ben Dusing. He and his family moved out of their home soon after the lawsuits were filed this summer. Dusing acknowledged to reporters in August that the IRS is investigating Galemmo and his hedge funds.

The suits claim that Galemmo bilked more than 150 investors out of as much as $300 million. ⬛